CH 23 - Additional Retirement Planning Issues

Question 1

When using the home as a financial asset the $250,000/$500,000 Home Exclusion applies to the clients ________ residence.

Answer 1

principal

Question 2

How often can the $250,000/$500,000 Home Exclusion be used?

Answer 2

once every 2 years (with exceptions)

Question 3

How long does the client have to own or use the home to qualify for the $250,000/$500,000 Home Exclusion?

Answer 3

Own and use home for 2 of 5 years

Question 4

Age restricted housing generally offer _________ activities.

Answer 4

recreation/social

Question 5

What type of housing does Age Restricted Communities offer?

Answer 5

single family homes/apartments/townhomes, etc.

Question 6

What is the age requirement for Age Restricted Housing?

Answer 6

residents age 62+

Question 7

Federal non-discrimination laws gives exceptions to Age Restricted Housing. What is the rule for ages 55?

Answer 7

• One resident in each home can be age 55 and
• 80% of total residents must be age 55 +

Question 8

A reverse mortgage is considered a _________ loan.

Answer 8

non-recourse loan

Question 9

What happens if the home value exceeds the reverse mortgage loan amount?

Answer 9

homeowner/heirs receive difference

Question 10

What are the the tax implications to payments received due to a reverse mortgage?

Answer 10

payments are not taxed

Question 11

What is the most common type of reverse mortgage arrangement?

Answer 11

HECM

Question 12

The amount available for a reverse mortgage is based on ________, ________, and ________.

Answer 12

age

value of home

interest and fees

Question 13

When does the bank get reimbursed for reverse mortgage payments?

Answer 13

at time of the sale of the home

Question 14

What is covered under the following Medicare parts?

Part A = _________

Part B = _________

Part C = _________

Part D = _________

Answer 14

Part A = hospital coverAge

Part B = doctor’s Bills

Part C = managed Care alternative

Part D = self-administered prescription Drug

Question 15

What is the age and status requirement for Medicare?

Answer 15

age 65 or disabled

Question 16

Advance directive should be discussed with ________.

Answer 16

a doctor

Question 17

Advance directives can be revoked and changed…

Answer 17

anytime.

Question 18

What type of insurance is guaranteed renewable?

Answer 18

long-term care insurance

Question 19

What is the different between the following long-term care policies cost?

indemnity policy = _________

reimbursement policy = _________

Answer 19

indemnity = policy pays actual daily benefit

reimbursement = pays actual cost up to daily limit

Question 20

How is the inflation rate calculated into a long-term care policy?

Answer 20

The calculation might be under actual inflation rate or could use a specified rate like 5%.

Question 21

Name the 6 ADLs.

Answer 21

Bathing

eating

dressing

Transferring from bed to chair

using the toilet

Continence

Question 22

What are the eligibility requirements for long-term care insurance?

Answer 22

2 of 6 ADL

or

cognitive impairment

Question 23

Who chooses the long-term care elimination/waiting period?

Answer 23

by the policyholder

Question 24

What is the “maximum benefit” under a long-term care policy?

Answer 24

The maximum amount of the daily benefit.

Question 25

What are TWO solutions to the pre-medicare and post-retirement health care gaps?

Answer 25

• continue coverage with the employer under COBRA for up to 18 months
• purchase an individual plan

Question 26

How long is the enrollment period for Medigap after enrolling in Medicare Part B?

Answer 26

6 month enrollment period

Question 27

What does it mean to say that all Medicare supplements are “standardized”?

Answer 27

All insurers sell the same polices.

Question 28

What are SEVEN excluded procedures under Medicare Part B? (SHE-CLOD)

Answer 28

Self-administered drugs (which is actually covered by Part D)

Hearing aids

Eyeglasses

Cosmetic surgery

Long-term custodial care

Orthopedic shoes

Dental care

Question 29

How much does Medicare Part B cover?

Answer 29

80% of physician and surgeon fees

Question 30

Medicare Part B is based on a participants ________.

Answer 30

income

Question 31

How much does it cost to enroll in Medicare Part A and Part B?

Answer 31

For those who are eligible (entitled to SS), Part A is FREE. Part B is available for a premium. If not eligible for both, you can purchase both.